On November 11, Bitfinex announced support for Bitcoin Cash hard fork happening on November 15.
On November 13, the exchange introduced Chain Split Tokens (CSTs) that will allow traders to trade the anticipated Bitcoin Cash tokens resulting from the Bitcoin Cash hard fork implementations “ABC” and “SV” on November 15, 2018. Bitfinex is designating these CSTs “BAB” (ABC implementation) and “BSV” (SV implementation).
“In the last days it has been more evident that the fork will likely result in two different chains, Bitcoin Cash ABC and Bitcoin Cash SV”, – writes the company, – “At the same time our BCH markets experienced a significant increase of Margin Short positions in quantity and size. To prevent any risk of manipulation and hence to maintain a healthy market we have decided to use the Chain Split Tokens (CST) approach to govern this particular event.”
These CSTs will trade against USD and BTC. Margin/leverage will be unavailable. Users will be able to create or destroy these new CSTs in any amount using the Token Manager located in the Order Type drop down menu of the sidebar order ticket, or in the menu at the top of the UI. Upon creation by a user, the BCH will be debited from the user’s account and an equivalent amount of BAB and BSV will be credited. Users will be able to reverse this process at any time using the Token Manager.
These CSTs will provide pricing continuity through the Snapshot Event. After the Snapshot Event, these pre-event CSTs will convert automatically to the post-event on-chain tokens.
When the hard fork occurs, Bitfinex will take a snapshot of all Bitcoin Cash balances and positions. BCH balances will be credited both BAB and BSV. Anyone who is short BCH during the Snapshot Event will have a their accounts debited BAB and BSV. If there is not enough BAB and BSV in the account, these users will have a negative balance of BAB and BSV. Anyone who is long BCH during the Snapshot Event will then have BAB and BSV credited to their account. In other words, outstanding positions (including margin positions) will be “claimed” and converted to currency balances. This will have the effect of margin funding being canceled and borrowers will need to restore their account to positive wallet balances in order to continue using the platform.
Anyone with a negative balance resulting from being a BCH borrower at the time of the fork will need to buy back into BAB and BSV before 31 December 2018 or risk having the system do it for them.
Once all negative balances have been settled, Bitfinex may delist BAB or BSV and make withdrawals only available for a limited time.
“While we want to make such forks available to our customers, our limited and temporary support for them is not and should not be construed as support for any particular project”, – adds the company.
